By Max Clarke
Despite Chancellor Osborne’s alleged ‘war on red tape’, businesses continued to struggle with burdensome legislation.
Basepoint, which specialises in the development and operation of flexible business, innovation and enterprise centres, recently surveyed its licensees from across the South and the Midlands, to find out the impact the coalition government’s policies are having on small and new businesses, and if more could be done to help them. The results showed that although 57% of tenants said their businesses will benefit from a cut in corporation tax, 42% said more could be done to cut the red tape and bureaucracy that is holding smaller businesses back from expanding - despite the government’s recent commitment to cut red tape.
“As a business that deals with finances all day long, many of our clients find corporation tax can be mitigated by various means,” says Noel Greaves of Copperfields Financial Management, a Basepoint Tewkesbury licensee. “But what smaller businesses like ourselves can’t mitigate, is the red tape we have to deal with. We’d like to see this reduced for all companies, so that they can get on with helping to rebuild this country’s economy.”
Fiona Ellis, who provides management and consultancy services for the public sector with Clarifi Consulting at Basepoint Ipswich, agrees: “Cuts in corporation tax do help, but there’s too much red tape surrounding government processes, especially as a smaller business working with the public sector. It would really help us if these processes were simplified and shortened.”
The government’s recent decision to raise National Insurance has also been an unpopular one with many small businesses. “Now has also been a really bad time to increase National Insurance,” says Simon Smith of employment consultancy Driveline, who is based at Basepoint High Wycombe. “I think the government should give all employers with new staff a 12-month NI holiday to incentivise them to take on more staff.”
Increasing holiday entitlement is also likely to deter smaller businesses from recruiting full-time members of staff, adds Stephanie Petitt of Equation Accounting from Basepoint Weymouth. “Giving employees six weeks off every year is too expensive for most small businesses to cope with the cost, and will put business owners off employing people.”
The assumption that all small businesses work in the same way is one they should address, adds Ian Goodman, director of Operations and Training at Pagoda Security Services at Basepoint Newhaven. “The security industry is quite unique in its structure. With regards to apprenticeships, any apprentices we hire have to wait until they’re 18 to go on any training courses to be licensed, which is expensive. More funding options should be available for this.”
James Irvine of Renewtech Energy, which provides training for the building and construction sector, is also at Basepoint Newhaven and agrees that the government should address the way it works with small businesses. “The government tends to pass all training work straight to local colleges, which don’t have the training or the staff to deal with the high level of tradespeople locally who need further training in installing solar thermal technology, heat pumps, and a vast array of other sustainable technologies. We’re then passed sub-contracting work from the local colleges who can’t deal with the demand. The government should come straight to us, and modernise the way it works to save them both time and money.”
The need to gain accreditations from separate councils and bodies is a real headache and expense for the health and safety industry, says John Lawrence of health and safety consultancy Tennyson Suite, another licensee at Basepoint Newhaven. “There is no one single body that governs the health and safety industry, so we have to spend £5,000 each year on accreditations from a wide range of bodies and councils. The clients we work with expect us to have several, if not all of these. Why is there not just one accreditation body for all small businesses? Something like this would help smaller businesses to compete more easily with larger firms, as well as saving them a lot of money each year.”
Brian Andrews, executive director of Basepoint Centres, comments: “This is a crucial time for small businesses as the economy stutters along the road to recovery. The coalition needs to appreciate that there are still considerable blockages that need to be removed if we are to see our small businesses throw off the shackles of the past and begin to develop into the growing economy. The coalition needs to embrace a business culture that develops and nurtures - not one that lives in the past and puts up obstacles. It’s tough enough without the additional burden of outdated and unnecessary red tape. Let’s hope that the Government’s ‘Red Tape Challenge’ (www.redtapechallenge.cabinetoffice.gov.uk) does actually act to swiftly resolve these burdens.”
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